Bacon's Rebellion

Democracy Thrives in Sunlight

SUBREGIONAL JOB LOCATION

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by

James A. Bacon
in

Before anyone other than The Great Fuzz Ball goes off and says “See, I told you so!” concerning today’s WaPo story on job growth between in the National Capital Subregion let us all take a deep breath.

“Region’s Job Growth a Centrifugal Force” reports that COG found the R=20 plus jurisdictions gained 78,097 jobs vs 94,847 jobs for those outside R= 20. That 16,750 job difference is just 0.7 of one percent of the 2.4 million jobs COG projected to be inside R=20 by 2025.

The growth of 94,847 jobs puts the “outer” jurisdictions well on the way to the 230,000 jobs that were projected by 2025 in this territory but that rate of growth still brings the “outer” areas up to less than 10 percent of the Subregions total jobs inside R=20 at that time. For a summary of these issue see “Where the Jobs Are,” 24 May 2004 at db4.dev.baconsrebellion.com

Besides the small percentage of the Subregion’s jobs this “news” focuses on also consider:

How many of these jobs are construction jobs on housing and residential service projects that will be going away when the buildings are completed? (Have you checked the trajectory of big house prices or how long units are staying on the market in the past six months?)

How many of these jobs are low paying service jobs supported by those with good jobs closer to the centroid (aka, in the “Core”) that have no time to mow their grass, care for their children or even walk their dog?

These are 2000 to 2005 numbers, as Larry Gross points out in his posting on the Gas Shock thread, $4.00 gasoline is going to change “everything.”

One fact is very clear: As of last week, employers were paying twice the rent per square foot for “Class A” places for employees near the centroid and within R=10 as they were in the R=20 to R=30 Radius Band. The latest wage numbers say that is true for the per month earnings as well.

Encouraging new job creation outside R=20 or R=25 (most of the new jobs in both Loudoun and Prince William are within R=25) is a good thing but only as long as those jobs contribute to creating a balance of J / H / S / R / A in Greater Culpeper / Culpeper, Greater Warrenton / Fauquier and other Disaggregated Communities outside the Clear Edge.

The WaPo article says that the “move-out-trend” is supported by the military job move to Ft. Belvoir. Ft Belvoir is just outside R=10, not beyond R=20. How soon the WaPo folks forget the radius map published just 8 days ago.

To its credit the reporter notes that there is a growing consensus that there should be a jobs / housing balance (a J / H / S / R / A Balance) and compact settlement patterns.

The story suggests that the state and municipal agencies continue to do a terrible job of fairly allocating location variable costs and of creating functional, balanced settlement patterns.

EMR

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15 responses to “SUBREGIONAL JOB LOCATION”

  1. Ray Hyde Avatar
    Ray Hyde

    OK, so they are paying twice the rent.

    Tell me, are they making twice the profit?

    If so, is it because they have “cost plus” government contracts at our expense?

    By the way, who is “the Great Fuzzball”?

  2. Ray Hyde Avatar
    Ray Hyde

    Isn’t the whole point of the article that the “growing consensus” for compact development is a consesus mainly among planners and largely ignored by everyone else?

  3. Anonymous Avatar
    Anonymous

    “Fairfax County has emerged as the largest jurisdiction in the Washington metropolitan area as measured by the number of residents and at-place employment. The value of goods and services produced in the County—the County’s economy—exceeded the value of goods and services produced in the District of Columbia, the region’s historic economic center, in 2002 and is projected to grow at a rate more than triple the District’s economic growth rate over the 2000-2020 period.”

    Stephen S. Fuller, Ph.D.
    George Mason University

  4. Jim Bacon Avatar
    Jim Bacon

    Ed makes a valuable distinction between construction/service jobs, which serve the bedroom-community economy, and “good jobs” closer to the core. The high-paying, “good,” jobs tend to be associated with what economists refer to as “primary” industries — industries that bring money into the region (as opposed to “secondary” construction, retail and other service jobs that merely recirculate money within the region).

    Northern Virginia’s largest industry cluster is in information technology and telecommunications. The logic that drives the locational decisions of ITT companies is considerably different from the logic that drives the location of a construction company, a J.C. Penney’s store or a McDonalds. ITT companies require a workforce with a high level of education and training, and very specific skill sets, and their location decisions are driven in part by a desire to maximize the size of their potential hiring pool. Let us look where those companies are locating. They are clustering in specific locations such as Arlington, Tysons Corner, Reston/Herndon and so on, where they can be accessible by the widest range of potential employees possible.

    Building on Stephen Fuller’s remarks above, I would argue that Fairfax County is emerging as a new centroid for the ITT economy, bifurcating from Washington, D.C., which remains the centroid for the government/lobbying/trade association economy.

    (There may be three centroids if you consider the biotech industry in Maryland, but I’m not very familiar with that region so I will not speculate.)

    Such an observation departs somewhat from Ed’s idea — I’m just thinking out loud right now –that the R=10 (Radius equals 10 miles) and R=20 should be drawn from the center of Washington, D.C. Perhaps the radius for the government-centric economy should be drawn from downtown Washington while the radius of the ITT economy should be drawn from Tysons Corner.

    But I would argue that Ed is entirely right to observe that the most important jobs — the jobs that drive economic growth — concentrate in the center of the relevant labor market. He is also right to observe that the job creation on the periphery of the Washington New Urban Region is qualitatively different than the job creation closer to the center.

    Roughly half the jobs in the economy are in the construction/retail/local service sector. It is no surprise when these jobs follow the population as it migrates to the periphery of the New Urban Region. But from my observation, the ITT jobs are staying close to the Fairfax County core.

  5. Larry Gross Avatar
    Larry Gross

    I agree. To better understand, we need to differentiate between source jobs and jobs that would not exist except for the source jobs.

    I’d posit that even more than half of total jobs are.. jobs that exist to serve the goods and services needs of those who hold the core jobs. A lot of government jobs ranging from code inspectors, fire/rescue, and teachers also exist because of the “core” jobs – because of the children that belong to both the core job employees AND the service-sector employees.

    These jobs are clearly delineated often times when the economic development folks “sell” the idea of attracting such core industries because of their “spin-off” jobs.

    The other aspect of this that I feel is even less understood is how much a particular job PAYS verses how much an average priced home is – in the area adjacent to where that person works.

    So, even a core job in the DC Area that pays less than what it takes to afford a modest home – will result in yet another commuter who will drive as far as they have to – to find a home that they can afford on their salary.

    And of course the folks who have jobs that are service jobs related to the core jobs most often are paid even less and have even less opportunity to find nearby affordable housing.

    All of this – I assert – is a major cause of congestion. It’s much more than just people trying to get from home to work – it’s the length of the commute and thus the longer time that a car stay on the road – along with thousands of others cars also on the road for long commutes.

    In the end – it’s not because people won’t live in compact communities – many would – if they could afford even an entry-level unit. Because they cannot, then they drive and once in the exurbs.. apartments/compact developoments are harder to find than ordinary 1/4 acre lot homes – for sale or rent.

  6. Ray Hyde Avatar
    Ray Hyde

    In Arlington, Fairfax, and Alexandria construction accounts for 7 to 9 percent of jobs. In Loudoun, Fauquier, and PW, it is 9 to 12% of jobs.

    I’d speculate that there are a higher percentage of citizens with construction jobs on the periphery because the homes they can afford are located there. The actual construction sites where they work are all over the map.

    But Ed is mistaken if he thinks that those jobs are going away. I know several families that have been in the construction business for generations, some of them are in Warrenton and some are in Fairfax. I believe they would feel that only elitist snobs think construction is unimportant or temporary. Whatever you think drives economic growth, it is construction that brings it to reality. Once it comes to reality, it is the service sector that cleans, mows, maintains, and plants that reality. Those balanced communities we hear about need to consider and make a place for those sectors and not dismiss them as unimportant.

    In Fauquier, construction provides the highest payroll of all the businesses sectors in the county. County officials will try to tell you that agriculture is the county’s largest business, and if you measure only gross output, they may be right. But if you look at profits or payroll, then agriculture is dwarfed by construction. It is official policy in Fauquier to limit construction by any means possible, but the next three largest employment areas area all government related. If you kill off you main breadwinner and the next three in line are all government, then where does productivity (and the ability to feed the government) come from?

    I think the “centroid” is really an L shape with one leg being DC to Dulles and the other leg being DC to Fredericksburg. Ed can paint this any color he likes, and I have no doubt that the center will remain strong for years to come, but the evidence clearly shows what the trend is (at least for now, maybe $5 gas will change it.)

    I believe our plans will be more successful if we base them on what is likely to happen (and what the trends show us has been happening for years, and in multiple cities) instead of basing them on the consensus of a handfull of planners, who apparently come to the process with a dog in the fight.

  7. Ray Hyde Avatar
    Ray Hyde

    I agree with Larry: it is the length of the commute that causes the problem, but it is not because the cars spend longer on the road.

    If the average commute is 10 or 20 or 30 miles, then the area served is 300 or 1200 or 2800 square miles, and you have proportionately more people trying to get to the same space. It doesn’t matter where or what shape you think the centroid is, you now have a much larger area attempting to get into a much smaller area to work.

    Say what you like, when I first moved to the area, I lived in Cleveland Park, in the District. Three times I have moved farther out and three times I landed closer to a better job. My first commute was 12 miles, (all within the core) and took 35 minutes, my present commute is 25 miles and takes 35 minutes. I hate to think what my original commute would take today. Some day I’ll go re-run it just to find out.

    So, how do you make the commute shorter? Either have more affordable and desirables homes closer in or have more desirable jobs where people actually live. Affordable and desirable homes closer in simply can’t happen because those places are already crowded and expensive.

    Ed is partly correct, there is some market push for those expensive places, otherwise they wouldn’t sell, but the real reason they are expensive is because they are inefficient: high tax, expensive to build, expensive to maintain, expensive to operate. No amount of market push will change that, but if other opportunities develop and people go elsewhere, then you will see a lot of inexpensive housing, a la Detroit.

  8. E M Risse Avatar
    E M Risse

    Jim raises an excellent point, any careful analysis requires several centroids.

    I am just trying to get the discussion moved off of 200 year old municipal boundaries that are today irrelevant.

    The centroid we use for our discussions of the Virginia portion of the National Capital Subregion is the Virginia end of the Memorial Bridge.

    I would guess that the centroid for federal work would be along Pennsylvania Ave in the Federal District.

    The one for Bio Med is somewhere inside the Beltway (Bethesda?) in Maryland.

    For IT it is in Virginia but perhaps closer to the R/B corridor than Tysons. If METRO get to Tysons then it will be there.

    Steve F. is of course right about the numbers for Fairfax but the end of Fairfax that bites is inside R=10 (from my original centroind).

    None of this changes what we have been saying for two years about the dysfunction of scattering urban land uses across the Countryside outside R=30.

    EMR

  9. Toomanytaxes Avatar
    Toomanytaxes

    EMR – Rail to Tysons does nothing to improve traffic. After spending billions on extending Metrorail, the State projects that the traffic will be as bad, if not worse. (Plus, we lose the billions of dollars that could be spent somewhere else.)

    Why; because all of the new density will add more automobiles, both from new residents and from new workers commuting to a larger Tysons Corner. The proposed rezoning of the Tysons Corner shopping center adds 9,000 new parking places to the existing 7,000. Moreover, none of the spaces would be for shoppers. Rather, the plans would add 9,000 spaces for the autos belonging to the condo residents and workers in the new office towers.

    In addition to the Tysons Corner Shopping Center rezoning request, there are more than 20 proposed amendments to the Fairfax County Comprehensive Plan for Tysons Corner alone. How many new automobile trips would those projects generate if approved?

    From a business perspective, there is already an extra property tax levy on commercial property in the Tysons Corner and Dulles Toll Road Corridor. I know several smaller business owners in Tysons who will be moving to the west once their leases expire. The added costs and density, with no measurable improvement in traffic will feed the very business sprawl many would like to stop.

    Also, it’s unlikely that any new housing at Tysons would be inexpensive. The land costs are high. The owners of Peacock Buick had 20 offers for its 3.5 acre lot. Moreover, my friends in real estate tell me that construction costs become much higher once a building exceeds 3 or 4 stories, which the Tysons Corner buildings would do. Therefore, it would be virtually impossible for there to be much affordable housing at Tysons. Couple this with the desire of many people for single family homes and we will have even more people driving to Tysons.

    We will continue to see individuals and businesses move south and west from the NoVA suburbs to seek better properties at lower prices. We need more jobs in outlying communities and much more teleworking.

  10. Larry Gross Avatar
    Larry Gross

    re: average commute – keep in mind that if you have situation where you have a lot of local commuters and a lot of distance commuters – that the average commute could be a very misleading measurement.

    Picture a histogram with a one and two sigma distribution. That data would tell you much more than “average”.

    re: commuting for affordable housing

    I think folks in this blog will generally agree that affordable housing is a primary factor in folks who first move to this area to take a new job – and then try to find a place to live that fits their salary.

    We’ve become not unlike NYC where there are tales of up and coming corporate execs and even FBI field agents who will refuse a job in that city because they know that they’ll be consigned to commuter hell if they want to find a place to live that fits their salary.

    I think the same thing is going on in the Wash Metro area – except – I must say that I often meet folks in the Fredericksburg area who say that they THOUGHT they were going to live in NoVa until they realized that they could not afford an 800K “starter” home.

    Yes, a “solution” would be to have jobs go where folks live and now commute but is it a likely scenario? Is it a practical thing to advocate for or advocate laws and/or regs that would essentially “encourage” (force) companies to NOT locate in NoVa and instead be pushed to locate in the exurbs?

    I would ask instead – what exactly are the factors that influence a company’s decision to want to locate in NoVa … OR locate in the exurbs AND … is THAT something that needs to be better understood and thus perhaps point to something that COULD be advocated for?

  11. Toomanytaxes Avatar
    Toomanytaxes

    Larry – Excellent suggestion re why do companies, especially different kinds of companies, locate where they do. This type of research could probably be done by George Mason University. It would also be useful to know where workers at large job centers (e.g., Tysons Corner, Rosslyn, Reston) live.

  12. E M Risse Avatar
    E M Risse

    TMT

    I did not say METRO to Tysons Corner would “improve traffic” congestion.

    I said METRO to Tysons Corner might shift the IT / T centroid further out the I-66 / DAAR Corridor. Centroids for Radius Analysis in large New Urban Regions have shared-vehicle system access. EOD.

    The only “solution” for traffic congestion in Tysons Corner is for the Beta Community of Greater Tysons Corner (including the Beta Villages of Greater McLean and Greater Vienna)– as well as the other 16 Beta Communities inside the Clear Edge in the Norther Part of Virginia — to evolve and become a balanced Alpha Community. EOD.

    All other “solutions” are bromides, delusions and excuses. EOD.

    EMR

  13. Ray Hyde Avatar
    Ray Hyde

    Larry, I don’t understand your point about distribution.

    Consider a little brain experiment. Suppose you have a 400 sq mile area with a uniform traffic grid, uniform rent, and uniform payscale, so that every destination is equally desirable. You have 400,000 vehicles. Averaged over the 20 x 20 mile areas the average trip distance is 14 miles. The auto density is 1000 per square mile.

    Now reduce it to 100 square miles. the average trip length is now 7 miles, but the vehicle density is now 4000 to the square mile.

    So, even if you allow the same amount of time for “rush hour” to occur, you are going to have twice the likliehood of encountering another car on your (shoerter) trip. Actually, it is worse than that because you have only one quarter as many intersections and therefore more congestion. And, although the distance is shorter, the time of travel is not.

    Then if you throw in situations like Seven Corners or the mixing bowl the situation becomes much worse locally, and the effect spreads like ripplles in a pond.

    Then if you consider that the rent and payscales are distorted by a factor of two (according to EMR) you find out that some work destinations are more desirable (more pay) and some home locations are more desirable (less rent, or lower combination of rent and travel cost).

    If you charge more for travel (full locational cost) then you change the shape of these cost distortions, but not the effect. Anyway you slice it, a denser, more compact area leads to more congestion.

    Is it practical to advocate for laws or regs that would encourage or force companies to locate differently? Maybe not, but surely it is an easier task to relocate a few companies than to write laws or regs that encourage or force millions of individuals to relocate.

    It seems perfectly clear to me that an overabundance of local job density is THE cause of predictable congestion of the type that repeats every day. If we throw up our hands and say we can order homeowners around but not businesses, then we are screwed.

    As it stands, either a home or a business needs permission to be created in a given location. But due to the idiotic way cost of community services studies are done, and due to the imbalance of taxes paid by homes and businesses there is a strong incentive to accept businesses and deny homes.

    We already have the laws in place to control both business and housing, but we are doing a lousy job of administering them and a lousy job of understanding the consequences.

    Instead of putting blame where it belongs, we prefer to demonize developers, speculators, and the business as usual interests. We prefer to take the easy way out with homilies like “you can’t pave your way out of congestion”.

    As far as I know, there is not a single square foot of class A office space in Warrenton, which is otherwise a lovely town and a pleasant place to live. I seriously doubt you could get approved for such a space if you tried; on account of the historic district, among other things. But the county is pushing for commercial development 15 miles away in the new Vint Hill commercial development area. The economic development managers for Vint Hill have proposed a thousand new homes for the area to create the housing to incentivise businesses to move there.

    I believe that what we know about where people live and work is based on surveys, and the data is pretty spotty. For one thing it is a pot picture and gives no evidence of the changes over time. It is the changes over time that ill us because the road network essentially does NOT change over time, and there is currently no desire to make needed changes as we shift from central cities to edge cities or even edgeless cities.

    As for businesses, there is an entire industry with computer models and economic predictions, living expenses, and shipping and travel costs and dozens of variables built in. Still, you would have to think that if a company can afford twice the rent to be in one location, then it has more resources available to make alternate decisions than the average homeowner.

  14. Ray Hyde Avatar
    Ray Hyde

    The original plan for the capitol beltway called for it to be supplemented by two bypasses. Forty years later they have yet to be built. A proposal for a 17 lane route 7 just shows how much the center of activity has moved.

  15. Larry Gross Avatar
    Larry Gross

    re: brain experiment

    I can tell we’re on totally different wavelengths.

    But.. let’s take a grid… let’s say a city grid with multi-story buildings, 20, 30 stories, with mixed development – businesses (both employment centers and service industries) and apartments/condos.

    Now, explain to me why such places do not “strangle” in congestion.

    Explain further.. why such places have not built additional mega roads to handle all the traffic both from the “compact” area AND exurban commuters.

    This seems to be the argument as to why it’s “better” for NoVa to have exurban commuters rather than more compact development.

    Is the basic premise – that NoVa “compact development” cannot be multi-story buildings – similiar to what we see in other urban centers?

    Is the basic premise – that mega highways should be built so that exurban commuters can continue to commute to NoVa so that it will not have to transition to more efficient settlement patterns?

    In other words.. is the premise that NoVa will not and should not transition to a more city-style urban center?

    I guess my primary thought is that the way NoVa is currently growing – is not sustainable.

    On the current path – you’ll have more and more exurban commuters that will need more and more roads – and you’re simply not collecting enough money to build those roads – so somebody is going to have to come up with the bucks and I’m betting that it will be in the form of direct user fees and higher gasoline prices – which … might render moot.. discussions about how things “should” be.

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